One of those involves our current local
renters, and how this month’s low home loan interest rates impacts their
housing choices. Put simply, many first time homebuyers are being attracted to
the value proposition newly presented by local bank owned homes. The increase
in the number of bank owned homes is part of the fallout from previous high
foreclosure levels. Combined with the current low mortgage rates, the result is
that, for the first time in a long time, some area renters may now be able to
afford to buy a home for the same cost (or less!) they are currently paying in
rent.
Before anyone jumps at the chance
to become a new home owner, though, they will be wise to take a look at some of
the additional factors that come into play in any decision about whether to
purchase one of those local bank owned homes.
FHA loans are a key factor in
making bank owned homes affordable. These government-backed mortgages offer
relatively lenient lending standards and low down payment
options. Yet the very same loans can also present the first time
homebuyer with a considerable stumbling block.
To qualify for an FHA loan (as well
as for some conventional loans), a home must be in what is deemed “saleable”
condition. And bank owned homes - while often a great deal - can come with
glaring problems that must be addressed before the ‘salability’ hurdle is
cleared. Major foundation issues, for example, are pricey fixes.
Old, leaking roofs can also cause a loan to be held up. Missing kitchen
appliances, broken windows, falling-down fences are all items that can
maddeningly delay or even derail the sale of local bank owned homes.
Still, the idea of finding a great
bargain cannot help but intrigue many current renters. And there are great
deals to be had for those who pencil out the potential advantage that might
result from targeting local bank owned homes.
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